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Rupee turns lower, Pound slips lower vs. Dollar

Tuesday,   09-Oct-2018   12:25 PM (IST)

The Indian rupee turns lower and is currently trading at 74.17/18 levels (12:03 pm) in the afternoon trade on dollar demand from foreign and state run banks tracking higher ndf rates. Rupee opened higher today 73.87/88 levels tracking gains in most Asian currencies amid a rebound in the Chinese Yuan. The benchmark indices are trading on a flat note amid weakness in their Asian peers. At 12:06 PM, the S&P BSE Sensex was trading at 34,416, down 59 points while the broader Nifty50 was ruling at 10,315, down 33 points. As per the technical indicators, range for USDINR pair for the remaining part of the day may be 73.60-74.30 levels. Rupee has an immediate support at 74.26 levels. A breach of the same may see rupee falling to 74.36 followed by 74.56 and 74.75 levels. On the positive side, rupee is likely to face resistance at 73.96 levels and if it is able to break the same then it may gain up to 73.76 levels followed by 73.66 and 73.55 levels. In the forward segment 1mth, 3mth and 6mth annualized premia are currently trading at 4.85%, 4.49% and 4.34% respectively.

Sterling slipped to trade little changed on the downside just below 1.3100 level as the UK Brexit Secretary Dominic Raab canceled his Brussels trip for next round of Brexit discussions on Monday while the International Monetary Fund lowered global growth outlook with the UK GDP growth lowered by 0.2% for 2018. Earlier on Tuesday, the British Retail Consortium reported a -0.2% m/m slump in sales in September. The USD/JPY pair managed to reverse an early dip to sub-113.00 level and is currently placed at the top end of its Asian session trading range, around the 113.20 region. The pair struggled to build on overnight goodish rebound of around 40-pips from 1-1/2 week low level of 102.82 and remained under some selling pressure for the fourth consecutive session on Tuesday. A combination of factors kept investors on edge and underpinned the Japanese Yen's safe-haven status, which was eventually seen exerting some downward pressure. Against the backdrop of escalating US-China trade tensions, political turmoil in Europe - led by Italy's budget proposals, dampened investors' appetite for riskier assets and the same was evident from persistent selling across global equity markets. However, a fresh leg of an upsurge in the US Treasury bond yields, supported by firming prospects for gradual Fed rate hike through the end of this year and beyond, helped the US Dollar to regain positive traction and limit any deeper losses.